Beware of Common Tax Scams: Protect Your Finances
Learn to identify and avoid common tax scams that target taxpayers. From identity theft to fake IRS calls and fraudulent preparers, this guide helps you stay protected and informed about how scammers operate. Stay vigilant, verify credentials, and know how to respond safely to suspicious activities to safeguard your finances and personal data.
Beware of Common Tax Scams: Protect Your Finances
Identity Theft
Personal information can be exploited by scammers to file fake tax returns and claim refunds. If you're a victim of identity theft, it's crucial to place a fraud alert on your credit reports and notify the IRS promptly.
Suspicious Phone Calls
Scammers often call pretending to be IRS agents, knowing personal details like your name, mother's maiden name, or last digits of your SSN. They may threaten arrest or filing issues and pressure you for quick credit card payments over the phone.
Related Reading: 22 Overlooked Tax Deductions
Payment via Gift Cards
Some scammers claim to be IRS officials, saying your tax notice was undelivered and insist you pay immediately. Instead of asking for personal info, they direct you to send prepaid gift cards or vouchers. Remember, the IRS does not accept payments through gift cards or similar methods.
Information Phishing
You might receive fake emails or calls claiming to be from tax software companies or IRS representatives insisting on verifying your details for refunds or issues. Scammers seek info like SSNs, birth dates, or employment info to file fraudulent returns and steal refunds.
Tax Preparer Scams
Fraudulent tax preparers may promise maximum refunds but use false information—such as fake dependents, ineligible credits, or incorrect incomes—charging a percentage of your refund. Always verify credentials and ensure your preparer has a PTIN. Review all forms before signing.
Stay informed on tax safety by visiting our Tax Tips page and follow us on Facebook and Twitter for updates on investing and finance.
